The company's stock fell as much as 3 percent in trading after the bell on the forecast, but analysts believe United Rentals will beat its own forecast.

"The management team has a track record of being conservative with their guidance, if you look at the past six quarters they have beat their own guidance and also beat the Street," Piper Jaffray analyst George Tong said.

United Rentals, which rents out forklifts, water pumps, diesel generators, earthmoving and trench safety equipment, said the volume of equipment on rent rose 7.2 percent while rental rates rose 6 percent in the fourth quarter.

The U.S. construction market has shown steady signs of recovery but the company has also benefited from increased exposure to industrial and non-construction markets.

The company expects full-year revenue of between $4.9 billion and $5.1 billion. Analysts on average were expecting revenue of $5.18 billion, according to Thomson Reuters I/B/E/S.

Net income rose to $41 million or 40 cents per share, in the fourth quarter, from $29 million or 39 cents per share a year earlier. Excluding special items, the company earned $1.27 per share.

Analysts on average were expecting earnings of $1.01 per share, on revenue of $1.26 billion.

Shares of the Greenwich, Connecticut-based company, which has a market valuation of about $4.6 billion, closed at $49.43 on the New York Stock Exchange.